The Product Life Cycle Presented by : Muhammad Arqum (bsit 06-24) Presented to : Madam Ammara

1. The Product Life Cycle • Presented by : Muhammad Arqum (bsit 06-24) • Presented to : Madam Ammara

2. The Product Life Cycle • Product development • Introduction • Growth • Maturity • Decline

3. Sales and Profit over the Product’s Life from Inception to Decline

4. Product Life-Cycle Applications • Product classhas the longest life cycle (e.g., gas-powered cars) • Product formtends to have the standard PLC shape (e.g., SUV’s, Sedans) • Brandcan change quickly because of changing competitive attacks and responses (e.g.,FORD, Honda) • Styleis a basic and distinctive mode of expression (e.g., formal clothing, Danish modern furniture,Classis cars) • Fashionis a popular style in a given field (e.g., business casual) • Fadis a fashion that enters quickly, is adopted quickly, and declines fast (e.g., pet rocks, and virtual pets)

5. Styles, Fashions, Fads

6. Practical Problems of PLC • Hard to identify which stage of the PLC the product is in. • Hard to pinpoint when the product moves to the next stage. • Hard to identify factors that affect product’s movement through stages. • Hard to forecast sales level, length of each stage, and shape of PLC. • Strategy is both a cause and result of the PLC.

7. Introduction Stage of PLC • Sales: low • Costs: high cost per customer • Profits: negative • Marketing Objective: create product awareness • Product: offer a basic product • Price: • Distribution: build selective distribution • Promotion: heavy to entice product trial

8. Growth Stage of PLC • Sales: rapidly rising • Costs: average cost per customer • Profits: rising • Marketing Objective: maximize market share • Product: offer extension, service, warranty • Price: stay the same or fall • Distribution: build intensive distribution • Promotion: reduce to take advantage of demand

9. Maturity Stage of PLC • Sales: peak • Costs: low cost per customer • Profits: high • Marketing Objective: maximize profits while defending market share • Product: diversify brand and models • Price: match or best competitors • Distribution: build more intensive distribution • Promotion: increase to encourage brand switching

10. Maturity Stage of the PLC • Modifying the Market: • Increase the consumption of the current product. • How? • Look for new users and market segments. • Reposition the brand to appeal to larger or faster-growing segment. • Look for ways to increase usage among present customers.

11. Maturity Stage of the PLC • Modifying the Product: • Changing characteristics such as quality, features, or style to attract new users and to inspire more usage. • How? • Improve durability, reliability, speed, taste. • Improve styling and attractiveness. • Add new features. • Expand usefulness, safety, convenience.

12. Modifying the Product Gillette’s Fusion razor combines a precision trimmer blade (on back) with a five blade shaving surface (on front). The flexible comfort guard and Enhanced Indicator Lubrastrip (containing vitamin E and aloe) enhance shaving comfort.

13. Maturity Stage of the PLC • Modifying the Marketing Mix: • Improving sales by changing one or more marketing mix elements. • How? • Cut prices. • Launch a better ad campaign. • Move into larger market channels.

14. Decline Stage of PLC • Sales: declining • Costs: low cost per customer • Profits: declining • Marketing Objective: reduce expenditures and milk the brand • Product: phase out weak items • Price: cut price • Distribution: selective--phase out unprofitable outlets • Promotion: reduce to minimal level

15. Product development Introduction Growth Maturity Decline How do you know?

16. Product development Introduction Growth Maturity Decline

17. Discussion • How can marketers help products bounce back from the decline stage?

18. Thanks for your patience.